The Mayor of New York, Michael Bloomberg, said
a merger between New York and German stock exchanges could force
European listed companies to apply US GAAP in spite of growing US
support to adopt IFRS.
Deutsche Börse AG is in advanced talks to buy
NYSE Euronext, which is valued at $10 billion. The deal would
create the world’s largest stock exchange by revenue and profits
with Deutsche Börse shareholders owning about 60% of the
shareholdings.
Bloomberg told
Reuters that a union “will force a common set of
accounting standards on the world; the American disclosures are
better”.
It remains to be seen whether companies listed
in a combined exchange would be required to report under IFRS, US
GAAP or both, but as the US appears to be moving towards IFRS
adoption it is more likely the international standards would be the
accounting rules of choice.
The US Financial Accounting Standards Board is
currently working on converging US GAAP with IFRS and the US
Securities and Exchange Commission is expected to decide this year
on whether US companies should switch to international
standards.
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